Following an announcement by US President Donald Trump regarding a series of reciprocal tariffs on various nations, both Bitcoin (BTC) and US stock markets experienced a significant sell-off.
On April 3, the S&P 500 opened with a 4.2% decline, marking its steepest drop in a single day since June 2020. The Dow Jones Industrial Average decreased by 3.41%, dropping from 42,225.32 to 40,785.41, while the Nasdaq Composite fell by 5.23%. Overall, the market witnessed a loss of $1.6 trillion in value at the opening.
Bitcoin’s value plummeted by 8%; however, a silver lining for bulls is their ability to fend off declines below the $80,000 support threshold. These dramatic reductions primarily arise from the uncertainty linked to the new tariffs, intensifying investor fears of a potential recession.
Image Credit: X
According to data from CoinGecko, the overall cryptocurrency market has seen a decline of 6.8% within the past 24 hours, and a short-term relief rally appears improbable.
Related: Bitcoin price risks drop to $71K as tariffs impact US business outlook
Crypto Liquidations Reach $573 Million
Statistics from CoinGlass indicate that over the last 24 hours, more than 200,000 traders have experienced liquidations, with the total amount surpassing $573.4 million. The most significant liquidation took place on Binance, where a position worth $11.97 million in ETH/USDT was forcefully closed.
Chart showing total crypto liquidations. Image Credit: CoinGlass
Meanwhile, Bitcoin’s open interest has fallen below $50 billion, resulting in diminished market leverage. Joao Wedson, CEO of Alphractal, pointed out that liquidation heatmaps show significant leverage near the $80,000 mark, which raises the risk of Bitcoin potentially dropping to the $64K-$65K range if this level is breached with substantial trading volume.
Bitcoin liquidation heatmaps. Image Credit: X
Related: Tariffs branded as ‘Liberation Day’ create turmoil in markets, raise recession concerns
This article does not provide investment advice or recommendations. All investment and trading activities involve risks, and readers are encouraged to conduct their own research prior to making decisions.